INTERNATIONAL STRATEGIC MANAGEMENT

Table of contents

Company chosen:- Marks and Spencer

PESTLE Analysis

Five forces

Positioning map and benchmarking

Vmost Analysis

Stakeholders Analysis

FiMo Performance review

VRIO Analysis

SWOT

Strategy

References

Company chosen:- Marks and Spencer

PESTLE Analysis

Political Factors Technological

● The United Kingdom's fashion retail ● As of January 2021, there were over
industry is well-known around the 65,32 million active mobile internet
world for its success. users in the United Kingdom, which
● Therefore, industry has called on the represents 96 percent of the overall
government to provide more demographic (Statista, 2021).
financing as a result of this. ● For the garment sector, this large
● If the government does not provide number of active internet users can
substantial assistance, 50 percent of be a boon.
the sector may be unsuccessful. ● As consumers surf the web on a
● A 2019 political stability index of the regular basis, they will be able to
 United Kingdom is 0.52. (The World look for clothing items and end up
Bank, 2021). purchasing items they enjoy.
● It's possible that many companies in
the fashion retail industry, such as
Marks and Spencer's, may
experience ambiguity and difficulties
in inflating the cost of items created
by the company due to political
instability and Brexit.

Economical Factors Legal Factors

● It was estimated that profits in the ● Fashion retail and the garment
garment market in the United business are really not influenced or
Kingdom in 2020 would be around affected by any such crucial legal
52 billion pounds, almost 2 billion factors.
pounds less than the year before ● As a result, the UK's fashion retail
because to the COVID-19 epidemic sector will be required to adhere to
(Shahbandeh, 2021). the nation's regulations and
● The garment industry and the prohibitions.
companies within it may suffer large
losses due to the decline in total
revenue and the ambiguity of
progress due to COVID 19.

Social Factors Economical Factors

● 62% of women in the UK bought ● Approximately £8.4 billion of the UK
clothing online in the past year, fashion market's revenue in 2019
according to the Office for National came from fast fashion, which was
Statistics. Youngsters of both estimated at £42 billion (Djordjevic,
genders made the most purchases 2021).
(Chevalier, 2021). ● The garment industry has a
● As more and more teenagers shop detrimental effect on the
online, corporations like Marks & environment, both in terms of
Spencer may have a tremendous production.
potential to get a ton of attention and ● A whopping 10 percent of all carbon
revenue. dioxide emitted into the atmosphere
 came from this sector
● An estimated 92 million tonnes of
scrap material is generated each
year by the clothing industry
(Djordjevic, 2021).

Five forces

Threats of new entrants: Low

The retail industry has a high entry barrier, because it requires huge capital inputs to enter
the market and it would be extremely difficult for a new operator to achieve cost savings and
economies of scale. Competitors provide discounts and offer prices that attract many
potential customers despite M&S' superior product quality.

Bargaining powers of suppliers: In the end of the 20th century, M&S suppliers were largely
British; nevertheless, competitive pressures led to outsourcing and price reductions and a
lowering of power for suppliers. M&S's concentration on private labels offers it an advantage
over external providers. In addition, as M&S relies on outsourced suppliers, M&S suppliers'
switching costs are rather cheap.

Bargaining powers of buyers: high

As There is little cost of changing and a broad array of options for customers, they have a
hand over M&S. By providing incomparable value and convenience, M&S must increase
consumer loyalty. In the UK, M&S is equally prone to adverse customer image fluctuations.
The competitors at M&S are also focused on consumer interactions so that the company is
vigilant and defends its position.

Threats of substitutes: High

In order to retain a strong brand position and remain different, M&S requires ongoing
innovation. In the clothing sector there are many alternatives; replicating designs and finding
the same ones elsewhere at a much lesser price is quite easy like at Tesco, Sainsbury and
ASDA. The future focus of M&S on its food supply should provide it a clear advantage over
competitors.
Rivalry amongst competitors: High
Currently, M&S is facing a tremendous level of competition. Through online expansion,
Sparks loyalty programme, low cost strategies, and newer ‘simply food’ stores have boosted
M&S’ ability to face competition.

Positioning map and benchmarking

Brand Name Strength Weakness

Mark and Spencers ● high-end value ● inability to penetrate

product successfully in
● spirit of innovation foreign
● encourages diversity ● poor brand loyalty
● unsold stock

Next ● strong brand portfolio ● compared to the

● strong distribution competitor days
network inventory is high
● high level of ● not compatible while
customer satisfaction working with different
cultures

Topshop ● effective social ● too expensive

media presence ● limited to certain
● celebrity demographic section
collaborations
● different range of
different brands

Wilko ● have an older market ● poor marketing skills

set up
● wide range of
products

Vmost Analysis

Vision
To be the standard against which others are measured.

Mission
To make aspirational quality accessible to all.

Objective
● Improved employee orientation
● Achieving a sales boost
● Establish organisational improvement

Strategy (Tactics)
-Improved employee orientation
+ establish succession management in the workplace
+ Attracting, motivating, and retaining a more skilled workforce to improve operations

-Achieving a sales boost

+ Provide better quality products
+ Adapt a more sustainable approach in sales
+ Improving promotional tactics
+ Prioritising consumer satisfaction

-Establish organisational improvement

+ Improving the overall value and appeal of their products
+ Improving scales to expand to newer territories and increase workplace development
+ Improve work culture

Stakeholders Analysis

Minimum Effort Keep Informed

Suppliers and the transportation ● Employees of the Marks and

Spencer

● The consumers

● The management of Marks and

 Spencer

Keep Satisfied Key Players

● Market ● The management of the Marks

and Spencer
● The consumers
● The managers

FiMo Performance review

Marks and Spencer marketing

Customer retention The organisation provides the product

according to the taste and preferences of
the customer and uses this policy as a
customer retention policy. However, the
organisation can use different promotional
strategies to do the same.

Sustainability The organisation tries to provide a long-

lasting and high-quality product to promote
sustainability in the environment. However,
it can implement the usage of natural
products to promote sustainability.

Marketing The organisation uses a competitive pricing

strategy that attracts more customers.
However, the organisation can also
implement different promotional strategies
to highlight its brand and increase
awareness about the product.

Mark and Spencer’s Operation

Employee 78000 employees in total are employed by

 Marks and Spencer.

Distribution The organisation has 19 distribution centres

and houses including the larger centres in
Brantford, Castle Donington and Swindon.

Brand portfolio Mark and Spencers offer to diversify their

brand portfolio which includes different
types of clothing and home product fooding
items and homeware.

VRIO Analysis

Competence Value Rare Imitable Organisation Result

al support

Quality Yes Yes Yes Yes Competitive

product advantage

Global Yes Yes No Yes competitive

business advantage
services

Skilled Yes Yes Yes Yes Maybe a

labour competitive
advantage

Marketing Yes Yes No Yes Competitive

technique advantage

SWOT

Strengths Weaknesses

● Highly experienced: Over the ● Diminishing sales: Supply chain

course of 136 years of functioning in mismanagement and shortages
the retail markets of the world, M&S have reduced the overall sales of
has gained a multiple level of M&S over the years.
experience. ● Public misconception: M&S is
 ● Highly recognised: M&S is a highly publicly percepted as a brand for
popular and reliable retail chain in older people which has reduced its
the UK and is recognised as one of public image as a retail brand which
the leading retail stores in the world. offers clothes to all ages.
● Multinational in nature: The ● Outdated operations: Due to the
company has a worldwide reputation usage of outdated technology and
and range over 1436 stores dependence on manual operations,
operating in different parts of the the company has failed to keep itself
globe. up with its competitors.
● High product range: The company
has a high range of food and other
apparel products which it provides to
the consumers.

Opportunities Threats

● Globalisation: With the increased ● Highly competitive market: The

level of inter connectivity in the world retail industry is a highly competitive
retail markets, M&S can aim to market and M&S must change
expand into newer countries. strategies regularly to keep its place
● Online expansion: Due to the in the market.
COVID-19 pandemic and rising e- ● Ever Changing trends: The altering
commerce trends, M&S can seize trends in apparel and other items
the opportunity to develop its online have reduced the overall profitability
channels. of M&S.
● Consumer segmentation: M&S
can follow the policy of consumer
segmentation in their target
audience to enhance sales.

Strategy

Expansion into new markets, particularly in Asia. Marks and Spencer items are becoming
increasingly popular in Asia. According to forecasts, the apparel industry will expand
between 15 and 23 percent per year. I'm referring to Shahbandeh (2020). For the Company
to meet customer demand, product differentiation will be required. To achieve this, the
company needs continue to work on its research and development practices over the next
few years.

SMART GOALS

Specific Measurable Attainable Reliable Time-bound

To increase To stay To improve the To improve the By the year

brand visibility connected to local local economy 2025
the social media environment to thrive

References

Blázquez, A. (2021). Marks & Spencer: number of employees 2021 | Statista. Retrieved 13
September 2021, from https://www.statista.com/statistics/872828/marks-and-spencer-
number-of-employees-worldwide-uk/
Chevalier, S. (2021). Online clothing purchasing by demographic Great Britain 2020 |
Statista. Retrieved 13 September 2021, from
https://www.statista.com/statistics/286096/clothes-and-sports-goods-online-purchasing-in-
great-britain-by-demographic/
Djordjevic, M. (2021). 28 Intriguing Fast Fashion Statistics for 2021. Retrieved 13 September
2021, from https://fashiondiscounts.uk/fast-fashion-statistics/#:~:text=What%20percentage
%20of%20fashion%20is%20fast%20fashion%3F&text=In%202019%2C%20fast%20fashion
%20had,billion%20of%20the%20total%20revenue
Shahbandeh. (2021). Topic: Apparel market in the UK. Retrieved 13 September 2021, from
https://www.statista.com/topics/3348/apparel-market-in-the-uk/#topicHeader__wrapper
Statista. (2021). Internet & mobile internet use in the UK 2021 | Statista. Retrieved 13
September 2021, from https://www.statista.com/statistics/507392/uk-number-and-
penetration-rate-of-internet-and-mobile-internet-users/#:~:text=UK%3A%20number%20and
%20penetration%20rate%20of%20internet%20and%20mobile%20internet%20users
%202021&text=As%20of%20January%202021%2C%20it,percent%20of%20the%20overall
%20population
The World Bank. (2021). United Kingdom Political stability - data, chart |
TheGlobalEconomy.com. Retrieved 13 September 2021, from
https://www.theglobaleconomy.com/United-Kingdom/wb_political_stability/